The General-Secretary of the All-India Bank Employees Association (AIBEA) C.H. Venkatachalam has said the recovery of overdue loans given to Kingfisher Airlines alone will be nearly sufficient to meet the wage increase sought for the nearly one million bank employees in the country.
A day ahead of the all-India bank strike on Wednesday, Venkatachalam told Business Line that nationalised banks have been very liberal in giving huge loans to Kingfisher owner Vijay Mallya but have shied away from recovering the debt. “Banks are competing to write-off big ticket loans given to Mallya and other corporates, but are unwilling to give small wage increases to the bank employees,” he said.
“The money being set aside for bad loan provisioning by nationalised banks is roughly equal to the employees’ total wage bill.”
The strike, called by the United Forum of Bank Unions, of which AIBEA is a member, is expected to disrupt banking services across the country as most of the employees in nationalised banks and old-generation private banks are expected to participate. The agitation is to press for a new five-yearly wage settlement, which was overdue by a year, Venkatachalam said.
“The pay revision for Central Government staff is due only in 2016, but the Government has already started the process of revision,” he noted. “For the bank staff, the Government has not taken any steps even a year after the last five-year revision has lapsed.”
Pointing out that the negotiations between the Indian Banks’ Association (IBA) and the Finance Ministry on the one side and the UFBU on the other had failed, Venkatachalam said the wage-increase offer was too meagre.
“The IBA’s offer amounted to just five per cent of the monthly pay,” he said. “This is not even a base figure to start negotiations and, hence, we rejected it outright.”
The UFBU, he said, was ready to resume wage negotiations if the IBA made a ‘meaningful offer’. The UFBU will meet on December 23 to take stock of the outcome of Wednesday’s strike and decide on the next course of action, he said.
He noted that the total wage bill of the public sector banks in the last financial year was Rs 56,000 crore. The wage increase offer should be a decent percentage of the total wage bill after taking into account the price rise, increase in bank staff’s workload and the operating profit of banks.
He claimed that the operating profits of banks were increasing by the year. For instance, the combined operating profit of public sector banks stood at Rs 1.20-lakh crore. But the net profit was only around Rs 50,000 crore as the banks had earmarked Rs 45,000 crore towards bad loans. Most of the bad loans (NPAs) were, in fact, ‘willful default’ by corporate borrowers, he claimed.
Venkatachalam said to achieve financial inclusion bank employees should be motivated to go the extra mile and, for this, a decent wage increase is the best incentive.